How To Improve the IT-Business Relationship

It’s possible to change IT from a poorly respected cost center to a high-functioning business partner.

Driving business transformation is a people, process, and technology thing.

Some people think they can change their business without IT. The challenge is that technology is the enabler of significant business change in today’s digital landscape. Cloud, Mobile, Social, and Big Data all bring significant capabilities to the table, and IT can hold the keys.

But the business doesn’t want to hear that.

Business Leaders Want to Hear About the WHY and WHAT of the Business

Business leaders don’t want to hear about the HOW of technology.

Business leaders want to hear about the impact on their business. They want to hear about how predictive analytics can help them build a better pipeline, or target more relevant offers. Business leaders want to hear about how they can create cross-sell/upsell opportunities in real-time. And, business leaders want to hear about the business benefits and the KPI that will be impacted by choosing a particular strategy.

The reality is that the new Digital Masters of the emerging Digital Economy bring their IT with them, and in many cases, their IT even helps lead the business into the new Digital Frontier.

How IT Can Change Its Game

While it takes work on both sides, IT can change it’s game by creating transparency around performance, roles, and value. This includes helping employees think and talk differently about what they do. IT can show very clearly how it delivers value for the money. And IT can change the way IT and business leaders make investment decisions and assess the returns.

IT Needs to Speak Business

“Poor relations between IT and business leaders can have many causes. Sometimes it's the personality of the IT leader. A common complaint among senior executives is that their CIO seems to speak a different language from the business. Another is that the CIO doesn't seem to understand what's really important. For example, a chemical company CIO we interviewed described how he communicates regularly with business executives about the innovative possibilities of digital technologies. Yet none of his business executive peers (whom we interviewed separately) seemed to find the discussions credible.”

IT Needs to Deliver Better, Faster, and More Reliably than Outsourcing

It’s a competitive world and IT needs to continuously find ways to deliver solutions in a way that makes business sense.

“Sometimes the issue arises from IT's delivery capability. According to Bud Mathaisel, who has served as CIO in several large companies, 'It starts with competence in delivering services reliably, economically, and at very high quality. It is the absolute essential to be even invited into meaningful dialog about how you then build on that competence to do something very interesting with it.' Unfortunately, some IT units today do not have this competence. One business executive we interviewed said, 'IT is a mess. It's costs are not acceptable. It proposes things in nine or ten months, where external firms could do them in three to nine weeks. We started offshoring our IT, and now our IT guys are trying to change.' A legacy of poor communication, byzantine decision processes, and broken commitments is no foundation on which to build a strong IT-business relationship.”

IT Needs a Good Digital Platform to Be High-Performing IT

In order to bet on IT, it needs to be high-performing. And in order for IT to be high-performing, it needs to have a good digital platform.

“However, the fault doesn't always rest only with IT leaders. In many cases, business executive share some of the blame ... high-performing IT requires a good digital platform, and good platforms require discipline. If your approach to working with IT can be characterized by impatience, unreasonable expectations, or insisting on doing things your way, then you'll need to think about how to change your side of the relationship.”

CIOs Can Lead Digital Business Transformation

Key business transformation takes technology. CIOs can help lead the business transformation, whether it's through shared goals with the business, creating a new governance mechanism, or creating a new shared digital unit.

“Regardless of the case, if your IT-business relationships are poor, it's essential to fix the problem. A bank executive stated, 'IT has been brought closer to business during the last five years. It is very important to success because man of the important transformations in our business are enabled by technology.' With strong relationships, IT executives can help business executives meet their goals, and business executives listen when IT people suggest innovations. Executives on both sides are willing to be flexible in creating new governance mechanisms or shared digital units. At Codelco, Asian Paints, and P&G, the CIO even leads digital transformation for the company.”

CIOs Can Help Drive the Bus with the Executive Team

CIOs can help drive the bus, but it takes more than senior sponsorship.

“So, how can you start to improve your IT-business relationship? Angela Ahrendts, CEO of Burberry, told her CIO he needed to help drive the bus with the executive team. However, leadership changes or top-down mandates are only the start of the change. Few CIOs can change the business by themselves, and not all business executives will climb on the bus with the CIO, even if the CEO demands it.”

Fix How You Communicate to Fix the IT-Business Relationship

“Fixing the IT-business relationship can take time, as people learn how to trust each other and redefine the way they work together. As with any struggling relationship, the best starting point is to fix the way you communicate. Does IT really cost too much, or are costs reasonable, given what IT has to do? Is the IT unit really too bureaucratic, or do all of those procedures actually serve a useful purpose? Are you a good partner to IT or a difficult one? How can IT make it easier for you to get what you need, while still making sure things are done correctly? What investments can help IT improve its technology, internal processes, cost-effectiveness, quality, or speed?”

Change IT from a Poorly Respected Cost Center to a High-Functioning Business Partner

It’s possible to change IT from a low performing cost center to a high-performing business partner. Companies do it all the time, and MIT has the research.

“MIT research into IT turnarounds has identified a series of steps that can change IT from a poorly respected cost center to a high-functioning business partner. The key change mechanism is transparency--around performance, roles, and value. The first step is to help IT employees think, and talk, differently about what they do. The second step proceeds to showing very clearly how well (or how poorly) IT delivers value for money--the right services at the right quality and right price, and where problems still exist. And then the third step moves to changing the way IT and business leaders make investment decisions and assess the returns that projects deliver. Through transparency around roles, performance, and investments, both sides can make smoother decisions and work together to identify and deliver innovation.”

If you’re part of a business that wants to change the world, start by reimagining how IT can help you achieve the art of the possible.